Daily Archives: September 11, 2017

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As would be expected, there are several transactions involved in buying and selling property, which attract fees and taxes. In Kenya, you incur charges from the moment you begin searching for feasible investment ventures.

While some costs are set, such as registration and requisite search fees, many costs associated with buying and selling real estate in Kenya are highly variable and based on:

The type of real estate

Location of the property

Commissions and fees charged and earned by the various professionals (which are also often based on type and location of the property)

The type of transactions

Documents you want or need

The estimated sum for round trip transactions can range from 4.5% to 6.8% of the selling/buying price of the real estate.

Real-estate Agent Fees

Searching fees: rates vary depending on the type, size and cost of property with an urban apartment in upmarket neighborhood costing as much as Ksh5,000

Viewing fees: varies among real estate agents but usually ranges between Ksh500- 1000 for residential houses and over Kshs5,000 for commercial properties

Listing Fees: varies depending on size and location of property with landlords paying from 2% the value of the property

Agent’s commission (buyer & seller): 1.25% of the sale price

Property Requisite Search Fees

Preliminary requisite search fee: Ksh500

Costs of obtaining requisite completion documents (seller): Kshs500

Registration Costs

Registration fees: Ksh500

Banker’s cheque fee: Kshs600

Land rent clearance certificate: Kshs 7,500

Stamp Duties

Stamp duties are taxes tied to documents and real-estate sale/purchase transactions. It’s usually based on the sale price of the property.

Duly signed sales agreement: Ksh200 for original copy and Kshs20 for each copy

Property transfer (properties within municipalities): 4% flat rate

Property transfer (outside municipalities): 2% flat rate

Mortgage: 0.1% of the amount of mortgage

Property leased for less than 3 years: 1% flat rate

Property leased over a duration of 3yrs: 2% flat rate stamp duty

Taxes

Income tax (non-residents): 30% of gross rental income

Income tax (foreign companies): 37.50% flat rate

Annual property tax: varies across locations and property value but is usually 1% of the property value

Land tax: varies by location of the land and is most costly in major towns such as Nairobi with rates as high as 8%

Legal and Mortgage Fees

Legal charges related with taking mortgage

Depends on amount of mortgage you take (higher mortgages mean higher fees) but mostly the rates are between 0.5-1.5% of the value of property

Property insurance: varies with duration of loan repayment and lender

Mortgage life policy: charged at 0.3% and 0.6% of the mortgage loan per year

Mortgage negotiation fees: although it varies, most lenders ask for 1% of the mortgage amount

Mortgage indemnity insurance: often ranges between 5 – 10% of the value of property